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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: John Carragher who wrote (17230)	6/12/2003 7:24:06 PM
From: Bob Rudd	Read Replies (2) \| Respond to of 78774

John: Cramer's probably right about there being more to it. Feels like what happened with several of the energy traders or TYCO or AOL - just when you thought it was all out, another shoe would drop as people keep sniffin for dirt. If Seidman's on a board he can't say anything, but does not want to hold forth a demeanor that would spread concern. It can't be overemphasized how critical confidence is. The .12% rise in borrowing costs to Freddy figures to cost 400mm so far. You're a bit high on the market share. A CBO report last year said Fannie and Freddy had combined market share of 71% with Fannie being about 30% larger than Freddy. The GSE's disputed that figure with Fannie's top guy saying the share was more like 27%...they don't want regulators to be concerned about the concentration of power and risk. While they probably are 'too big to fail' due to their collective importance to the mortgage and housing market, don't think for an instant that that translates into a safety net for shareholders. If things go south shareholders will be of no concern to regulators. Debt holders will be safe and the function will be preserved but shareholders could get toasted given the leverage. Just my opinion and I'm no authority.